On a diagram of a production possibility frontier,economic decline (negative growth)is represented by the production possibility frontier shifting inward.

Question

Quizplus · Accepted Answer

Economic decline (negative growth) means that an economy is producing less goods and services than it did before. This will result in a decrease in the production possibility frontier (PPF), which is a graphical representation of the maximum amount of goods and services an economy can produce with its given resources and technology. The inward shift of the PPF indicates that the economy can no longer produce as much as it used to, which represents a decline in economic activity. Therefore, statement A is correct.

On a Diagram of a Production Possibility Frontier,economic Decline (Negative